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Public Relations in the Web 2.0 world

Kmart is a brand in search of itself. It’s needed saving for a long time. I can’t recall a reason to go there, and my significant other can clearly tell you why she never will again.

The brand is troubled. It’s hurt Sears too- they became part of the same company when a financial wizard who knew nothing about retailing, but “saw value” in the real estate that came with the company.

No matter how much money Kmart could spend on advertising this holiday season, they couldn’t have bought the positive PR they’ve received in this area with “anonymous donors” paying off layaway accounts. From the Dayton Daily News:

Kmart stores across the region report that anonymous donors are paying off the remaining balances of layaway accounts of strangers in a showing of holiday generosity.

Kmart store managers in Trotwood, Fairborn, Beavercreek and Riverside said unknown visitors are acting as secret Santas and spending hundreds of dollars to cover the layaway bills of complete strangers, especially people who are late on their payments and who are in danger of having their orders canceled.

Most of the donors also look to pay off come-due or past-due layaway accounts that contain toys or gifts, hoping to prevent some area families from having an empty space beneath their Christmas trees.

“They are looking for layaways with children’s clothing in it and toys in it to try to help out families that might be in need,” said Ron Monmaney, store manager of the Kmart in Riverside. “It must be the season.”

On Saturday, two unknown individuals spent more than $1,000 at the Riverside Kmart to pay off the layaway accounts of six strangers. Monmaney said the customers were “elated” to find out their orders were paid off, and they were touched by the gesture.

On at least five occasions in the last two weeks, unknown individuals walked up to the layaway counter at the Kmart in Beavercreek and paid for the accounts of strangers who were late on their payments or who were struggling to make them, said Jerry Campana, the store’s manager. He estimates the mysterious Good Samaritans spent at least $800.

“I think it’s truly amazing,” Campana said. “The best part of it is they are not doing it for any kind of recognition … they are just going out and doing it out of the goodness of their hearts and for people they don’t even know.”

The random acts of kindness started earlier this month at Kmarts in Michigan, but stories of the activity spread through news coverage and online, and it is now taking place all over Ohio and the country.

When you look at Kmart shoppers and realize that the people using layaway are at the absolute bottom of the income spectrum, the idea that put stuff on layaway with the hope that some “wealthy donor” will pay it off works the same way that buying a lottery ticket does: building an unrealistic dream. Is there any tool more used in advertising?

Supposed Kmart decided to invest between $3K and $5K per store in “anonymous donors” – compared to spending it on TV ads nationally. With 1,382 stores nationally, at $4k per store: that works out to $5.52M, which is a 2.5% of a 2009 budget of $224M. The payback in free mentions of this “feel good” story far exceeds what paid media would achieve.

For every question I get about the wonders of “web 2.0″ it’s rare that we hear clients ask “what can I do to make my customer happier?” Will a mobile version of your website make them feel better about the washing machine they just bought? No.

It comes down to customer service- and understanding that the best marketing is outstanding customer service- “marketing as a service.”

Amazon got it when an ad agency suggested they spend at least $30 million a year on ads- and instead they decided to give their customers free shipping (of course, once they started into their own products like the Kindle- they had to start advertising).

One has to credit Crispin Porter + Bogusky for taking on Domino’s Pizza- and not only telling them that the quality of their pizza is the problem (they probably told VW that being below average in the JD Power car quality charts wasn’t helping sales too) but getting the company to pay money to tell customers that their pizza did suck, but it’s better now:

You can spend all the money on marketing you want- just remember, if your product or service is less than stellar- good advertising will only kill your product sooner.

That’s the beauty of web 2.0, not, when you screw up, someone will tell a lot of people- either on your site, where you can respond and try to fix it- or on anyone of millions of other sites, including their own- where you may or may not be able to respond. If you haven’t set up Google Alerts on every product name, company name, key people in your business- you may be finding out the hard way when things are going wrong.

If there is one place we need customer service 2.0 it’s government. Unfortunately, most politicians and bureaucrats think they are immune from finger pointing (although they’re all aces at it). The rest of the nation already understands the value of open, honest communication, unfortunately we’re still doing government with rules from long before the information age.

If you want an in your face take on customer service, I give you Gary Vaynerchuk of Wine Library speaking at SXSW (parental advisory for naughty words):

As a parting thought- thanks to Gary- it also doesn’t hurt for your company to have a personality either. Try reading “Personality not included” by Rohit Bhargava- it’ll wake you up to what kind of service is possible with personality.

There is no “App for that” when it comes to customer service- it all comes from the choices leadership makes. Advertising or free shipping? Quality product or lower pricing? A warranty that customers can believe in, or a legal trap to play gotcha?

Customer service should be first on everyone’s mind, everyday, because there is an app to tell the world when you screw up- you’re looking at it now. Comment below at will.

A local newspaper does it. Puts a non-inclusive list of pizza shops online and runs a poll for “best of the city” pizza. This will grant “bragging rights” for the next year as “This cities best pizza.”

Now, pizza is a very subjective subject- some like it with thin crust, some thick, some believe in wood fired and others like deep dish. The “contest” is really not about the pizza- but about the paper driving traffic to their site and selling ads.

But, it can have real effect to the winners and the losers. The winner get’s bragging rights- and possibly a business bump. The losers all get ticked off. Next thing you know, you’ve lost a subscriber, a reader, or respect from the pizza aficionados who really know pizza- all because the contest wasn’t really a contest, but a popularity contest- and with internet voting, for the most part- a very imperfect system that can and will be gamed. Bragging rights for pizza is one thing, but a contest for a hybrid school bus takes this to another level. This is a real prize and required the students to invest time in creating a video/work of art to compete. Now, you’ve asked for free labor (crowd sourced creative) and then left the “judging” up to whomever can rig the system best.

We will choose the top 10 finalists, then all of America will be invited to vote online for the ultimate champion. Students of any age can enter (although a parent or teacher will need to sponsor students under 13 years of age). Group or class entries are also encouraged.

There is no requirement to watch all 10 videos before voting, no way of verifying without a doubt that voters are actual voters. It’s not like the Superbowl ad meter- which is a more scientific system, although not perfect by any means.

While all the voters may actually be made aware of your new hybrid bus, the 9 losers won’t be happy. And, does the stunt of the contest really advance your brand? Or does it alienate the losers it creates?

Contests for contests sake are fine, but once you tie in user generated content and ask people to do your work for you- make sure that the user gets more benefit that you do. Considering YouTube is the second most important search engine- consider requiring key words or links to a page that you want to have at the top of search- instead of allowing it to be a popularity contest open to all- have a real panel of judges to filter the final entries- and allow all the other entrants to judge the finalists- with a random prize for those who take the time to review the top finalists.

Just like you wouldn’t bet the farm on a spot that tested well with bad methodology- why run a contest that way?

Unless you like being tagged #FAIL by those who believed in your contest in the first place.

Advertising has always about telling your message. Maybe that’s why John Wanamaker famously said “I know half my budget is wasted, I just don’t know which half”- and he was almost half right. Instead of telling your story- listen to what customers say about your brand and make new stories. Take this story about a hotel guest who tweeted about his stay at a hotel- and their follow up and it’s results (read the whole post to get the whole story):

So a tweet, a few emails, and all of a sudden I have a hotel in Boston that feels very much mine. Why would I stay somewhere else when I know the people, and feel like theyre genuinely happy when I come back again?

Its not about the discount – Id happily pay their going rate to stay there, just for the experience. But it is about the personal connections Ive made with people, the feeling of being a valued customer, and the sense that Im dealing with a business that really cares about the people that support it.

There is a another old adage: People do business with people they know. Establishing connections, building a network, are part of building those business relationships. Twitter is just one more tool in the social media toolbox. How many tools is your brand using?

I saw a tweet from Jason Calacanis before the e-mail hit my inbox. Netflix was raising rates for a second time in 5 months on blu-ray disc access. If you are in marketing at Netflix, please note, he has 64,188 followers. Take that- and retweets- and you see the exponential nature of Twitter- instantly.

Then, follow over to a twitter search on “Netflix” and you see the effect- instantly- the twitterverse is alive- with cancellations, downgrades and unhappieness. This is an opportunity for Blockbuster- but, they probably don’t know how to take advantage of it.

Over on Engadget- it’s breaking news:

Ruh roh. In a move that will undoubtedly cause an incredibly raucous stir, only to fade away as movie renters realize that Netflix is still the best deal going, America’s most adored by-mail rental service is hiking the price of Blu-ray rentals once again.

The comments are flowing- who knows how many people will be blogging about this, and what kind of damage will be done. The pricing increases are heavy handed to begin with- but the automatic “Opt-in” to a price increase is a brand suicide move. Never, ever, force an automatic price increase without some kind of action by the customer.

Either way- be careful how you treat your customers these days, they have the tools to talk amongst themselves and plot your downfall. Both Netflix and Twitter are populated by opinion leaders- who are very tech savvy. Your brand is only as good as your community around it. Netflix’s brand value is totally connected to the way their customers feel about them (as well it should be).

Respond on the “offending” site- within the comments asap- even if it’s a “We’re looking into this”

Admit your own mistakes on your company blog- and make sure you give credit to the customer for pointing out where you screwed up so you won’t do it again. This was Dell’s solution to the Dell Hell scenario.

Have a company twitter account- where your fans can follow your brand.

Make sure you have support forums on your site that are moderated and useful. There is nothing worse than having customers going to other experts to solve problems with your products or service and having the competition recommended.

It wasn’t more than 8 hours before Peter had a response from TiVo. I don’t know if my e-mail to their Investor Relations department was part of the solution, but, in it- I said I didn’t think they really wanted to make a million dollar PR blunder over a $29 refund to a previously happy customer.

While many companies used to say “the customer is always right” we believe the new adage should be “the community is always right.” Offend one, and risk offending many.

Will having a huge network make you a one person consumer rights team? We’ll see soon enough.

Conventional traditional paid media is dying a quick death. The old discussion of targeting consumers and buying their attention in :30 second increments is over. Twitter may be the ultimate media for the attention deficit consumer who has suffered media overload for the last 30 years. When used correctly, you can make a million with 140 characters. You just have to follow the lead of the Dell Outlet:

Out next week, but wanna welcome all the new followers based on news Dell sold $1M thru Twitter. Happy Holidays to all!

Releasing deals, one at a time to opt-in followers created a new way of connecting intimately with people who want to buy their products. It’s that connection that is the secret sauce of new media marketing in a web 2.0 world.

Social media requires an opt-in relationship, meaning it’s only going to last as long as you keep providing value. Many companies talk about their “commitment to the customer” but- what they need to be evolving to is a “commitment to the community.” Defining and nurturing that relationship isn’t a part-time job to hand to the intern either- just see what happens when a relationship is done right: Robert Scoble (who started at Microsoft and grew a community that would stay with him instead of M$)

Twitter is a way to tie your company into a community in real time. Not having to wait weeks to produce an ad and get it out into the marketplace can be a powerful tool to out-maneuver your competition.

Is well worth reading as well. The 9 ways- without their full descriptions to tease you to click on the link:

Listen to conversations in real time.

Track emotion moments.

Get link love.

Reach unreachable people.

See what’s popular/important

Introduce more people to your personal brand

Get quick answers.

Optimize your event attendance.

Read instant feedback.

There are more ways in the comments, including: build relationships with leaders in your field, track customers and competitors, but, most importantly- connect with a community.

Here is the final word on why Twitter is neither a marketing shotgun or rifle- those analogies are just as dead as the idea of conquering customers in a war for market share. You don’t buy market share, you don’t win it- you earn it, by building relationships with real people, one-on-one, in real time.

More than ever, the idea of keeping existing customers should be at the top of every marketers critical tasks list. Not only are new customers harder to acquire, but, they now have the power to tell all their friends when you fail to please.

If you doubt me, take a look at Amazon reviews in any consumer products category. You’ll find the most powerful reviews come from either:

loyal customers who have had great customer service and warranty experiences

customers who’ve owned your product and a competitors and have an opinion.

It’s time to pay more attention to keeping existing customers happy.

The other night I was talking over a dinner table with several happy TomTom customers. One of them had just had his TomTom die, and it was just outside of warranty. He contacted TomTom and they said they don’t repair non-warranty units.

Big mistake. The customer service person just released a previously happy customer out to the big wide world of GPS units and suggested he reevaluate the market. All of a sudden, he may think a Garmin or a Magellan is a better choice. It doesn’t take much to come across a comparison site.

For a better example of how to handle this same situation- I had a Sonicare toothbrush die on me after 5 years. I contacted Sonicare, and inquired about a new battery for my first generation model. They offered a sizable discount on a new model toothbrush- in a brown box that kept me a Sonicare user.

Yes, personal electronics may be made for replacement, but wouldn’t you rather customers replaced your product with your brand- instead of a competitors. Good marketers will take this lesson to heart and make sure their policies fall in line with what is best for their company.

It’s said that word of mouth marketing is the best of all- and yes, you can buy good word of mouth, with good warranty policies.

If you are wondering how to build brand loyalty, increase market share, improve customer satisfaction, don’t do it the HP way.

Besides having an utterly useless, overly complex website, an arcane product naming system, and a penchant for dividing up products into categories that make no sense (what is the real difference between a desktop computer for home or business?)- they absolutely don’t get customer service and support.

I’m writing this while listening to an endless loop that is about 6 minutes long- this is after I paid $39 for “support.”

Frankly, no amount of advertising can make up for a horrible support experience. Instead of paying your CEO big bucks, shareholders should demand that HP hire enough support people to handle a call in less than 2 hours (yep, that’s how long I’ve been waiting).

If you’re wondering how much HP is paying current wunderCEOkind – here is an article about his original salary package:

Incoming Hewlett-Packard CEO Mark Hurd will get a $2 million signing bonus and a $1.4 million salary for taking the helm at HP, but he stands to make far more if he can successfully boost the company’s flagging share price.

According to documents filed late Tuesday with the Securities and Exchange Commission, HP’s new CEO will receive 700,000 HP stock options and stand to earn tens of millions of dollars more as part of short-term and long-term bonus programs. The options will vest over a four-year period.

The 48-year-old executive will be given an additional 400,000 stock options and 450,000 shares of restricted stock to make up for the equity compensation he gave up when leaving NCR. The stock will vest over three years. The restricted shares alone have a value of more than $8 million.

Hurd, who became NCR’s top executive in March 2003, took home roughly $2 million in salary and bonuses last year at NCR, up from about $1.5 million the prior year, according to NCR’s most recent proxy statement.

Hurd will also be given a $2.75 million “relocation allowance” in moving from NCR’s Dayton, Ohio, headquarters.

Note, when calling Apple for enterprise support for an XServe, the longest hold time was 5 minutes. They offered a call back service, and the hold music- it was contemporary, great music- further showing that the brand is hip, cool and someone I’d prefer to do business with.

What’s even worse is I’ve already identified my problem as a bad HP jetdirect card, model 615n, that has an extended warranty. It would have been cheaper for HP to immediately look up the issue on their own site, admit, they’ve failed, and send the card than put me through this hell. The $10,000 printer that I bought is just over three years old. HP has been sending me marketing materials to try to get me to trade in and up to their new model. After this experience, I’d be hard pressed to buy HP ever again, even though I’d been generally happy with this product previously.

If Mark Hurd wants to boost the share price, he needs to make sure people have good reason to buy HP products. No sales, mean no profits. Investments in technical and customer support help stop people from writing their horror stories online for all to see. Mark, consider taking a pay cut- or try answering your phones for an hour a day.

[UPDATE] 9:35 am next day- STILL ON HOLD- but, they are still sorry I’ve been waiting and will be with me as soon as possible.

[UPDATE] 19.5 hours – same loop- have used the contact form for Mark Hurd, CEO at HP. Of course, after filling out my details- they still call me a “valued customer” instead of simply personalizing using my name. Still on hold. Their products must really suck if the call volumes are that large.
[UPDATE] 10:40 called on another line- have been assured I’ll be connected to a support technician. Hung up the other call- losing my place in the queue, but, we need to actually take calls in the office. At least this is music only on the hold loop.

[UPDATE] 11:38- after another hour on the phone, they determined what I already knew- the Jetdirect 615n was at fault. However, the “extension” of 5 years for the warranty ended on Oct. 31, 2008 (even though I’d only had the printer 3 years)- and that they would be happy to sell me a new card at the discounted price of $209 if I return the defective 615n. A quick google search found it at http://www.memorysuppliers.com/ for less than $139 with overnight shipping. Of course, I could have taken this route yesterday if HP had answered their phones.

If buying an HP product, consider the horrible customer service and really worthless website that comes with their products. Apple shines in comparison.

Your business depends on the perception of value to your customers. Consumers or customers or patients or guests- whatever you choose to call the people you sell your product or service to, want to feel that they have made the right decision in hiring you to solve their problems.

When we say “Create Lust: Evoke Trust” we get down to the core of what makes people buy. They want what you have to offer because they are confident in your ability to supply what ever it is that they want. They should feel good about their purchase. They look for affirmation from others to justify their decision. Often, just a client list can instill confidence that they are dealing with a professional.

For small business, advertising has become almost cost prohibitive in these days of too many media choices, too many messages and too many options. Because advertising via mass media is almost an oxymoron, sponsored search advertising has become perceived as the only viable option for small business. I’ll define “sponsored search” for those of you new to the term: it’s having your ad appear when someone does a search on a certain keyword. Google is by far the leader in this market, and it sets it’s prices purely by auction- meaning the price of an ad depends on how much competition you have. This is very good for Google- and not very good for you.

That’s why we believe that social media (a good definition of social media can be found on the Radian6 website (update 3012- Radian6 was bought by Salesforce and the link is gone) and on Wikipedia) and good branding are so important in this age of information overload. The Next Wave is one of the leaders in teaching social media/web 2.0 to it’s clients and to others across the country as well as one of the earliest adopters of the technology. It’s part of why we’re called “The Next Wave.”

If “fake it to make it” is really a strategy, and today, more than ever, it’s apparent that guru’s can appear from anywhere. If you want an example- just take a look at “The Evolution of Dance.” Needless to say, being able to dance your way through a meeting has taken new meaning.

Which brings us back to social media and small business. Experts are always nice to have around. If you want to grow your business, finding the right expert to solve your problem can make it much easier for you to do what you do best. Social media- or web 2.0 enabled websites (like this one- partially) allow you to demonstrate your value and knowledge to the world- and have a conversation with other people interested in your area of expertise. Building networks is still one of the secrets to getting your foot in the door- only now, the network isn’t built with closed communities (Harvard or West Point grads come to mind) but in open communities online. The more people you connect with in your field, the stronger your brand.

This video on social media has a whole bevy of people who have exploited the social media tools to build their value in the greater community. Proof positive was how easy it was to Google their names and come to a their site- on the top of the list.

We’ve even connected with a few of the people in the video- like Steve Hall from AdRants.

Their tips? Here is the search friendly run down of the six minute video:

The social opportunity
Brian Solis PR 2.0FutureWorks
Grow communities around you by engaging them- you become an authority and influential

While being on Linkedin.com,facebook.com and other business social media sites, there is nothing quite like having your own site and strategy to spread your message. Once you get your potential customers to your site, looking like you have your act together is critical- and that’s where branding comes in.

We have a small confession to make: we’ve been so busy working on other sites, that we’ve let our own slip a bit- but, that’s going to be addressed soon.

For a great introduction to how the web, search and open source content managers work (the best friend of the social media pro)- we highly recommend taking our Websitetology Seminar. If you aren’t in Ohio- we can bring it to your city- just organize a development day for your professional organization and we’ll do a revenue share that will help you raise money for your organization and build your social media knowledge.